Understanding Liquidity Which of the following will improve liquidity? 1. A comp

Question

Understanding Liquidity Which of the following will improve liquidity? 1. A company purchases a new truck with cash 2. A company receives cash from taking out a long-term loan that is due in five years 3. A company substantially increases credit sales and expects to collect all of the credit sales in the current account period. 4. A company purchases inventory on credit but is having trouble selling the inventory as most of it has become obsolete. 5. A company took out a long-term loan four years ago. The loan is due next month

Explanation / Answer

Which of the given above situations ill inprove the liquidity of a company

Answer---Situation 2

Explanation

Explanation is provided for each point separately

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